The FIGHTER Act would exempt regular military compensation from federal income taxes for active-duty service members. The bill excludes "regular compensation" (as defined under military pay law) from taxable income, meaning military personnel would no longer owe federal income tax on their base pay. There is one exception: individuals who served in Congress within the 10 years before receiving military compensation would not qualify for the exemption. The bill takes effect for tax years beginning after December 31, 2024. The legislation also includes a cost-offset provision requiring the Department of Government Efficiency to find federal spending cuts equal to the lost tax revenue from this exemption.
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